Medicare Payments Delayed

2012 Medicare revenue will be delayed. CMS has announced that it is directing its contractors to hold new, January 2012 claims, for up to 10 business days in order to effectively test and implement the new 2012 Medicare Physician Fee Schedule (MPFS). CMS expects these claims to be released into processing no later than January 18, 2012. Claims with dates of service prior to January 1, 2012, are unaffected.

On Friday, December 23, 2011, President Obama signed into law the legislation necessary to temporarily prevent the scheduled Medicare SGR related payment cut for radiology and other practitioners from taking effect on January 1, 2012. The negative update for the 2012 MPFS is now scheduled to take effect on March 1, 2012.

However, this legislation extended a number of other “expiring provisions” that will have an immediate impact on radiologists as well as other providers. While the physician fee schedule update will be zero percent, other provisions of the legislation require changes to how the 2012 MPFS is implemented.

Causing the current revenue delay is the requirement in the legislation that the relative value units (RVUs) used to calculate the 2012 MPFS rates be budget neutral. According to a CMS press release, “To make those changes budget neutral, the conversion factor must be adjusted for 2012.” CMS is currently developing and testing the new 2012 MPFS to implement these modifications. Medicare contractors will be posting the new rates on their websites no later than January 11, 2012.

In addition to the delayed Medicare payments, the requirement in the legislation that the relative value units (RVUs) used to calculate the 2012 MPFS rates be budget neutral will equate to income redistribution for radiologists. The change will not raise or lower total Medicare expenditures but it will “redistribute” the money available.

This has happened in each of the past several years and has resulted in a 1 percent to 3 percent decrease to radiology. Once the 2012 MPFS is published on January 11, 2012, ADVOCATE will determine the decrease resulting from this change and provide more information.

Best regards,
Kirk Reinitz, CPA
President & CEO